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IGST on ocean freight can't be imposed on importers, companies tell SC

IGST on ocean freight can't be imposed on importers, companies tell SC

Importers have argued against the imposition of integrated goods and services tax (IGST) on ocean freight in the Supreme Court on Thursday. They pleaded for the quashing of a petition by the government filed in the apex court against a Gujarat High Court judgment that had declared IGST on ocean freight as violative of the Constitution.

Ocean freight is the cost incurred through an agreement between two foreign parties to ship goods to India. For instance, if goods are exported from Washington, the exporter concerned may enter into an agreement with a shipping line there and pay ocean freight to it.


A provision in the Central GST Act permitted levy of both basic customs duty and IGST on the cost, insurance and freight (CIF) value of goods brought into India. A government notification later also extended IGST to ocean freight on importers on the reverse charge mechanism.

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